Understanding Executor’s Obligations and Duties
It is an honor to be asked to act as an executor of a family member or friend. Before accepting an appointment, however, it is important to understand the obligations and duties of an executor. The law treats an executor as a trustee, and imposes a high standard of conduct on all aspects of an estate administration. British Columbia and federal laws also places time restrictions on various steps in the process, including when an estate can be distributed. The role of executor is accordingly one to which considerable time and effort must be committed.
Paired with the legal requirements imposed upon the executor is the need to manage beneficiary expectations and communications. If the executor is one of those beneficiaries, interpersonal relationships can become complicated and sometimes hostile.
The core duties of any executor can be summarized as follows:
- safeguard and preserve estate assets
- apply for a Representation Grant of the Will from the courts
- invest estate assets prudently
- satisfy the will-maker‘s liabilities from estate assets
- account to the beneficiaries periodically
- distribute the estate
Possible complications in estate administration should be considered. These may include: claims against the estate (whether by creditors or from claims for outstanding family law property division or a variation of the Will); minor or disabled beneficiaries; disputes over personal and household belongings; and (where the will-maker owned interests in private corporations) post mortem planning to avoid double taxation. While a well drafted Will and estate plan can reduce these complications, not all will-makers have taken the time and effort to seek the necessary advice.
An executor is entitled to seek and rely upon professionals in the administration of an estate, and should do so early in the process to ensure that no duty or obligation is overlooked. It may be helpful to engage a professional to act as agent for the executor. This can reduce the burden of the administration, but of course, all discretionary decisions must be made by the executor personally.